Types of Banks

A. As to ownership
1. Privately Owned- It is organized and capitalized by private citizens for their profit.
2. Publicly Owned- It is owned and organized by the state and sometimes has a
minimum of private ownership. The Charter is granted by the enactment of a
special law to govern in its operations.

B. As to the place of incorporation

1. Domestic Bank -It is incorporated under the laws of the Philippines. Majority of stocks
are owned by the Filipinosin conformity with the Philippine Corporation Code.
2. Foreign Bank- It is incorporated under the laws of another country although the bank
might be doing business in the Philippines.

C. As to Structure
1. Stock Corporation- They are stock corporations when the bank sells shares of stocks to
the general public to raise capital.
2. Non Stock Corporation- The organization is on membership basis.

D. As to function and line of development.

a. Commercial bank - A commercial bank is one that receives demand deposits and gives
out short term loans.
b. Trust Company- It is an institution which deals in fiduciary activities such as
administrator of estates, guardian of minors’ interest, executor of legal wills and
testaments, registrar and transfer agent of stocks and bonds and similar activities.
c. Savings Bank- A savings bank is one which primarily receives safekeeping funds from
persons who have no immediate need for cash and invests these funds in long-term
investments.
d. Rural Banks- It is organized primarily to cater to the needs of small farmers, small
businesses , small cottage industries and cooperative associations.
e. Development Bank- It takes care of giving loans to be used for developing the economy
and may therefore engage in medium and long term lending.
f. Cooperative bank- It is organized to furnish the credit needs of duly registered and
operating cooperative associations of different kinds.
g. Investment Bank- Is one which assists government bodies and newly organized
corporations to raise funds for capital through the sale of stocks and bonds. It handles
a business of high risk and therefore necessitates a large amount of capital.
h. Central Bank- Is a bank of banks. It does not deal directly with the public. It is usually the
supervisory and regulatory agency, which makes all the banks “ tow the line”.

E. As to management
1. Unit bank- it is one where the ownership is concentrated on one corporation which does
banking business independent of others.
 2. Group banking- When a majority portion of the stocks of two or more banks are held by
a holding company.The members of the group may be unit banks or banks with
branches or both types.
3. Branch banking- There is a head office and also branches.
4. Chain Banking- When one or more persons control the activities of banks.

Give at least 2 examples per type of bank. :)